3 thoughts on “Economic reflections and the riots”

  1. Posted 15/08/2011 at 18:00 | Permalink

    Work hard for low pay? If there is any particular virtue in working for low pay as opposed to that family wage that makes a father out of a man, we may as well canonise as saints those who of their own free will work for nothing, while reproving the highest-paid in the land as supremely depraved.

  2. Posted 15/08/2011 at 20:05 | Permalink

    Is unemployment part of the problem?

    I would say the last thing most of those people would ask for is a job.

    All in all a good and thorough analysis, hope you can forgive my bit of levity.

  3. Posted 16/08/2011 at 10:06 | Permalink

    I agree with much of this. As I argued under Kristian Niemitz’s blog post, the ‘left’ interpretation that the riots were principally caused by relative poverty may well have some merit. However, as we can acknowledge that poverty may be a (not the indefinite article) structural cause but disagree with the best solution. I would argue that the poverty and inequality has been caused by the presence of state intervention, removing inequality does not require further intervention. The lack of jobs, for instance, which you highlight, is principally caused by state-produced disincentives to work (transfer payments, high marginal tax rates etc) and destruction of job creation via regulation and taxation policies. The idea that further intervention is a good solution to a problem essentially caused by intervention is patently absurd, although we see it in many areas of state intervention, it creates a sort of feedback mechanism.
    On the ‘right’ there seems to be an idea that more authoritarian policing measures and a change in ‘culture’. I fail to see either of these helping – authoritarian approaches deals with effects not causes and will probably have unintended negative consequences. In terms of culture, why ought politicians tell us what our forms of culture and behaviour ought to be when by their own policies they are encouraging exactly the sorts of behaviours they profess to abhore?? I think it better that politicans stop moralising and focus on the proper sphere of government.
    I believe, however, that a change of policy is needed, and quickly. What is needed is huge deregulation and reductions in state spending which will promote economic growth and change the incentives that such individuals face.

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